U.S. lawmaker unveils sweeping Pentagon acquisition reform bill

FILE PHOTO: U.S. Representative Mac Thornberry (R-TX), chairman of the House Armed Services Committee, addresses a news conference following a House Republican caucus meeting at the U.S. Capitol in Washington, October 21, 2015.Jonathan Ernst

(Reuters) - The head of the U.S. House Armed Services Committee introduced legislation on Thursday to cut cost overruns at the Pentagon by overhauling the way it buys everything from common off-the-shelf goods to services and intellectual property.

Representative Mac Thornberry, a Texas Republican, told reporters, "if you're buying office supplies, you ought to be able to go on Amazon and do it."

"The current acquisition process prohibits rapid purchases of goods at the best prices because" the Department of Defense is restricted to using expensive and onerous contracting processes, committee aides said in a statement about the bill.

Thornberry hopes to spark debate about the initiative and then wrap it into the annual National Defense Authorization Act, a broader bill that sets policy for the Defense Department each year, committee aides told reporters.

Thornberry and the committee drafted the legislation after more than a year of examining billions of dollars in cost overruns, schedule delays and other problems that have plagued defense procurement programs.

The legislation includes measures that would allow existing business to business e-commerce markets, such as Amazon.com Inc or W W Grainger Inc, to sell the military commercial off-the-shelf products such as staplers or forklifts. This would expand procurement options beyond the Pentagon's current e-commerce program, EMall.

The legislation also aims to make the Defense Department's acquisition system more proactive, agile, transparent and innovative, committee aides said, noting that further measures would be proposed in coming years.

This bill would consolidate reporting for services contracts and allow for more transparency and accountability for program managers, committee aids said. In 2015, the Pentagon spent $274 billion on contracts of which $144 billion, about 53 percent, was spent on contracted services.

The bill also incentivizes the Pentagon to consider purchasing intellectual property earlier in the acquisition cycle. It was hoped that purchasing intellectual property, such as technical data for missiles, while an acquisition process is still competitive would lead to lower overall costs.

Committee aides said the legislation was crafted with input from acquisition officials, industry and outside experts.

"It is essential to be more agile in the face of technology that changes to fast and threats that change so fast," Thornberry told reporters.